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I have heard about a top global bank that asked exactly the same four questions and spent tens of millions to implement a multicurrency global liquidity management system to find the answers. Midway through the implementation, a combination of challenges related to data quality, systems integration and change management set against the backdrop of a regulatory deadline reduced the scope of a project to a Euro liquidity management system. At the end of the project, liquidity management went largely out the window and the bank was left with a payment processing system for a new payment type.

Not to single out any bank or technology vendor, but noble goals don't always translate into concrete results, which is probably why Excel still reigns supreme. This is not unique to TMS for, according to a saying I've heard, "70% of FORTUNE 500 companies use ERP but 90% of them submit board reports in Excel!" It's not very surprising that so many solutions pitched as "overcoming the tyranny of Excel" don't secure budgets from the C-Suite who are used to seeing fancy reports and charts - not tyranny - in Excel!

Kudos to these two banks for taking the early lead on using mobile and social media to jump on to the 'omnichannel banking' bandwagon. This move should resonate well with the preferences of an overwhelming majority of customers to research banking products online but buy them at branches.  

Source: Survey across Australia, Canada, USA and many other countries done by CEB Financial Services Customer Experience Survey, as cited in this TowerGroup report. 

Why blame politicians for the sins committed by banks and solution providers in designing systems with so much friction that many of their ePayment products are rejected by mainstream banking customers? Not just in the UK, the recent decision by INGDirect USA makes this point eloquently: Although its customers have chosen to bank with a direct bank that has no branches, they clearly want the convenience of making payments by paper checks instead of jumping several hoops to put through an electronic payment.

Amazon didn't cause a BORDERS moment by getting bookstores banned. Nor did iPhone disrupt the mobile phone market by lobbying with some industry assocation to turn against the BlackBerries or Nokias of the world. Similarly, ePayment providers need to realize that they can change the status quo only through the strengths of their products and UX and not via an artificially-guaranteed cheque-less market.

Ironically, the recent decision to continue with cheques in the UK might actually boost ePayments: Finally, banks and solution providers might start designing products and devising go to market strategies in such a way that customers voluntarily choose ePayments over cheques.

+1 re. free security software from HSBC. I had to eventually uninstall it. 

It will be interesting to watch how this issue pans itself out. Will banks implement better security measures for Internet Banking yet keep it simple and convenient enough so that more customers migrate to remote channels? Or, will the enhanced security create even more friction in remote channels such that customers will troop back to branches?  

The regulation on 'alien' or 'rival' ATM cash withdrawals swung between the two ends of the pendulum in India over the past year but the state of equillibrium reached recently seems very fair to customers and banks alike: 5 free transactions per month, and a nominal charge for each transaction thereafter. Since this policy is uniformly applicable for all banks and across all types of accounts (on which ATM cash withdrawals are permitted), there is no discrimination against customers at the bottom of pyramid or anyone else. According to personal and anecdotal evidence, branch footfall has dropped significantly since this policy was implemented.   

CARD Act, Reg. E and now Dodd-Frank-Durbin are examples of regulations that mandate many banking fees to be "reasonable" - which means set at levels that reflect true costs. Most bank payments shops should have no difficulties in agreeing that your suggestions could help them acquire competitive advantage, enhance customer satisfaction, and so on. However, I am not sure if they would want to adopt them to cut costs because (a) They've gotten this far with these kinds of costs (b) Switching accounts is a pain and there's no guarantee that the next bank is any better than the previous one, and, most importantly (c) The next regulation around the corner could force them to reduce fees for payments to match their reduced costs, which means their revenues would nosedive from their current stratospheric levels.

Recently, even I had the chance to reverse the table on a bank when they called me to reconfirm my credit card reward redemption order. After years of answering stupid ID verification questions whenever I've called them, it was great fun this time to flatly refuse to answer any of their questions to me and instead make them answer a few of mine to prove their ID to me! 

Using mobile phone prepay / postpay accounts - I imagine it's the same as MNO Billing - as a substitute for m-wallets is a great idea in theory. However, MNOs seem to demand as much as 40% in transaction fees, thus restricting their use to high-margin virtual goods industry. Zong, BOKU and other GenY Mobile Payments / MNO Billing companies are constantly hoping that transaction fees will drop to 10%. However, until that happens, a bulk of what we call 'mobile payments' is really a misnomer, with the mobile phone used simply as another form factor instead of key fobs or plastic cards. The transaction continues to be funded via credit cards, debit cards and other conventional bank-issued instruments and run over the conventional card network rails. That's why whenever I hear that mobile payments will disintermediate banks from the payment loop, I have a good laugh:  Much of what we know today as mobile payments will not exist without banks.

The very fact that sanctions screening is mandatory for most cross-border electronic fund transfers indicates money is used for illegal purposes even in non-cash form.

One perfectly legal use of cash that explains the disproportionate growth in the use of cash is the rise in the number of unbanked people who are entering the workforce and earning wages but not yet becoming banked. For example, in India, the government's rural employment scheme called NREGA has helped a lot of people in the rural areas earn money. NREGA seems to have spread much faster than the rural push of banks since many NREGA beneficiaries continue to remain unbanked.

Another point worth noting is payments made to plumbers, electricians and other handymen. They typically happen by cash but I'm not sure if they get reported as part of retail payments. In India, even fees to general physicians are often made in cash. All these are perfectly legal uses of cash and a growing middle class leads to disproportionate growth in use of cash. 

Although the linked Times of India article is only two days old, several banks in India have been providing realtime SMS alerts for ATM debit card transactions for several years to customers (like me) who have subscribed to them. Although this article and post make no mention of it, what's new is banks in India have recently started sending realtime SMS alerts for credit card transactions. This requires no subscription and works as long as the bank has the cardholder's mobile phone number (which is handed over by most people in India without any fuss whenever they're asked for it - like, for example, during account opening). It covers card present and card not present transactions. It's a great service and has already helped me spot one fraudulent transaction within two months since its launch. While I won't mind paying a nominal fee for it, it happens to be provided free-of-cost for now.